
	Year Ended December 31,
(In millions)	2023		2022		2021
U.S. Federal:
Current	$	2.6	$	115.3	$	12.6
Deferred	293.4		263.7		(182.7)
	296.0		379.0		(170.1)
U.S. State:
Current	1.9		26.5		7.7
Deferred	2.6		20.3		(10.8)
	4.5		46.8		(3.1)
Non-U.S.:
Current	530.8		618.7		(91.3)
Deferred	(683.1)		(309.9)		869.2
	(152.3)		308.8		777.9
Income tax provision	$	148.2	$	734.6	$	604.7
Earnings (loss) before income taxes:

United States	(951.5)		794.8		(1,982.5)
Foreign - Other	1,154.4		2,018.4		1,318.1
Total earnings (loss) before income taxes	$	202.9	$	2,813.2	$	(664.4)

For all periods presented, the allocation of earnings before income taxes between U.S. and non-U.S. operations includes intercompany interest allocations between certain domestic and foreign subsidiaries. These amounts are eliminated on a consolidated basis.


(In millions)	December 31, 2023		December 31, 2022
Deferred tax assets:
Employee benefits	$	148.7	$	129.6
Litigation reserves	32.2		20.5
Accounts receivable allowances	413.7		446.2
Inventory	143.8		159.3
Tax credit and loss carry-forwards	758.2		760.3
Operating lease assets	51.3		56.2
Interest expense	114.8		94.8
Intangible assets	167.7		149.3
Other	326.1		209.3
	2,156.5		2,025.5
Less: Valuation allowance	(421.4)		(387.0)
Total deferred tax assets	1,735.1		1,638.5
Deferred tax liabilities:
Plant and equipment	54.0		56.6
Operating lease liabilities	51.3		56.2
Intangible assets and goodwill	2,506.2		2,880.3
Other	166.4		151.5
Total deferred tax liabilities	2,777.9		3,144.6
Deferred tax liabilities, net	$	(1,042.8)	$	(1,506.1)

For those foreign subsidiaries whose investments are permanent in duration, income and foreign withholding taxes have not been provided on the unremitted earnings of those subsidiaries. This amount may become taxable upon a repatriation of assets from the subsidiary or a sale or liquidation of the subsidiary. The amount of such unremitted earnings is approximately $1.18 billion at December 31, 2023. Determination of the amount of any unrecognized deferred income tax liability on these unremitted earnings is not practicable as such determination involves material uncertainties about the potential extent and timing of any distributions, the availability and complexity of calculating foreign tax credits, and the potential indirect tax consequences of such distributions, including withholding taxes.


	Year Ended December 31,
	2023		2022		2021
Statutory tax rate	21.0	%	21.0	%	21.0	%


Clean energy and research credits	(5.2)	%	—	%	9.8	%
Foreign rate differential	(58.8)	%	(3.6)	%	31.4	%
Expiration of attributes	1.5	%	9.8	%	—	%
Goodwill impairment	60.8	%	6.5	%	—	%
State income taxes and credits	(3.9)	%	1.3	%	(0.6)	%
Tax settlements and resolution of certain tax positions	14.2	%	1.0	%	0.9	%

Impact of the Combination and divestitures	11.2	%	(6.7)	%	(109.7)	%
Incremental U.S. tax on foreign earnings	69.4	%	2.0	%	(36.9)	%
Valuation allowance	10.9	%	(13.6)	%	(8.4)	%
Deferred tax impact of tax law changes	(1.0)	%	5.4	%	7.0	%
Withholding taxes	7.4	%	1.5	%	(1.3)	%
















Deferred tax impact of internal restructuring	(74.0)	%	—	%	—	%
Other items	19.5	%	1.5	%	(4.2)	%
Effective tax rate	73.0	%	26.1	%	(91.0)	%

In all years, our effective tax rate is impacted by the jurisdictional location of earnings and the corresponding tax rates in those jurisdictions. The Company realizes benefits from lower tax rates in Singapore and Puerto Rico due to manufacturing and other incentives.

During the year ended December 31, 2022, a Puerto Rico net operating loss, which was recorded in conjunction with the Combination, expired unutilized resulting in a $274.4 million write-off of deferred tax asset and corresponding valuation allowance. The expiration and valuation allowance impacts are reflected in the above table.

A valuation allowance is provided when it is more likely than not that some portion or all of the deferred tax assets will not be realized. At December 31, 2023, a valuation allowance has been applied to certain deferred tax assets in the amount of $421.4 million.

When assessing the realizability of deferred tax assets, management considers all available evidence, including historical information, long-term forecasts of future taxable income and possible tax planning strategies. Amounts recorded for valuation allowances can result from a complex series of estimates, assumptions and judgments about future events. Due to the inherent uncertainty involved in making these estimates, assumptions and judgments, actual results could differ materially. Any future increases to the Company’s valuation allowances could materially impact the Company’s consolidated financial condition and results of operations.

•U.S. federal net operating loss carryforwards of $281.9 million, which were recorded in connection with the Oyster Point acquisition. While the utilization of these carryforwards is subject to Section 382 of the Code, the Company does not anticipate that this limitation will impair our ability to utilize the carryovers.

•Non-U.S. net operating loss carryforwards of approximately $879.4 million, of which $718.1 million can be carried forward indefinitely, with the remaining $161.3 million expiring in years 2024 through 2043.

•Anticipatory foreign tax credits of $150.8 million which will generate from the reversal of future taxable income in certain non-U.S. jurisdictions which are taxed both in their local jurisdictions and in the U.S.

On November 16, 2020, the Company had a change in ownership pursuant to Section 382 of the Code. Under this provision of the Code, the utilization of any NOL or tax credit carryforwards incurred prior to the date of ownership change may be limited. Analyses of the limits for each ownership change indicates the annual limitation would not impair the Company's ability to utilize our U.S. federal credit carryovers. While state loss carryforwards may be limited by Section 382 of the Code, the carryforwards are largely offset by a valuation allowance.

On August 16, 2022, the U.S. government enacted the Inflation Reduction Act of 2022 (the “Inflation Reduction Act”) into law, which includes a new corporate alternative minimum tax (“CAMT”) and an excise tax of 1% on the fair market value of net stock repurchases. Both provisions are effective for years after December 31, 2022. The Company reflected the applicable estimated excise tax in treasury stock as part of the cost basis of the stock repurchased and recorded a corresponding liability in Other current liabilities on our consolidated balance sheet as of December 31, 2023. The share repurchase and authorization amounts disclosed in this Form 10-K exclude the excise tax. The Company does not anticipate being subject to the 15% CAMT tax in 2023 based on enacted law and regulatory guidance; however, our CAMT status for 2023 could change in the future, depending on new regulations or regulatory guidance issued by the U.S. Department of the Treasury.

In addition, many countries are actively considering or have proposed or enacted changes to their tax laws based on the Pillar Two Global Anti-Base Erosion Rules (“Pillar Two Rules”) proposed by the OECD. The Pillar Two Rules impose a global minimum tax of 15%, and under these rules, we may be required to pay a “top-up” tax to the extent our effective tax rate in any given country is below 15%. We will continue to monitor the implementation of the Pillar Two Rules in the countries in which we operate. The earliest effective date of the Pillar Two Rules in any adopting country is January 1, 2024, with many countries postponing implementation to January 1, 2025 or later, if at all. We are currently evaluating the potential impact on our consolidated financial statements and related disclosures.

The Company is subject to income taxes and tax audits in many jurisdictions. A certain degree of estimation is thus required in recording the assets and liabilities related to income taxes. Tax audits and examinations can involve complex issues, interpretations, and judgments and the resolution of matters that may span multiple years, particularly if subject to litigation or negotiation.

Although the Company believes that adequate provisions have been made for these uncertain tax positions, the Company’s assessment of uncertain tax positions, including those arising from legal entity restructuring transactions in connection with the Combination, is based on estimates and assumptions that the Company believes are reasonable but the estimates for unrecognized tax benefits and potential tax benefits may not be representative of actual outcomes, and variations from such estimates could materially affect the Company’s financial condition, results of operations or cash flows in the period of resolution, settlement or when the statutes of limitations expire.

The Company is subject to ongoing IRS examinations. The years 2015 through 2021 are open years under examination. The years 2012, 2013 and 2014 had one matter open, and a Tax Court petition was filed regarding the matter and a trial was held in December 2018 and is discussed further below.

Several international audits are currently in progress. In some cases, the tax auditors have proposed adjustments or issued assessments to our tax positions, including with respect to intercompany transactions, and we are in ongoing discussions with some of the auditors regarding the validity of their tax positions.

In instances where assessments have been issued, we disagree with these assessments and believe they are without merit and incorrect as a matter of law. As a result, we anticipate that certain of these matters may become the subject of litigation before tax courts where we intend to vigorously defend our position.

In Australia, the tax authorities have issued notices of assessments to the Company for the years ended December 2009 to December 2020, subject to additional interest and penalties, concerning our tax position with respect to certain intercompany transactions. The tax authorities denied our objections to the assessments for the years ended December 2009 to December

2020 and we have commenced litigation in the Australian Federal Court challenging those decisions. A trial took place in October 2023 and a decision is awaited. The Company made a partial payment of $56.0 million in 2021 and $5.2 million in 2022 in order to stay potential interest and penalties resulting from this litigation.

In France, the tax authorities have issued notices of assessments to the Company for the years ended December 2013 to December 2015 concerning our tax position with respect to whether income earned by a Company entity not domiciled in France should be subject to French tax. We have commenced litigation before the French tax courts where the tax authorities will seek unpaid taxes, penalties, and interest.

In India, the tax authorities have issued notices of assessments to the Company seeking unpaid taxes and interest for the financial years covering 2013 to 2018 concerning our tax position with respect to certain corporate tax deductions and certain intercompany transactions. Some of these issues were resolved through the Company entering into an agreement with the tax authorities in March 2023 in respect of the pricing of its international transactions. The Company recorded tax expense of approximately $22.3 million during the year ended December 31, 2023, due to the terms of this agreement. The remaining issues are in the audit phase or are being challenged in the Indian tax courts.

The Company has recorded a net reserve for uncertain tax positions of $287.1 million and $298.1 million, including interest and penalties, in connection with its international audits at December 31, 2023 and 2022, respectively. In connection with our international tax audits, it is possible that we will incur material losses above the amounts reserved.

The Company’s major U.S. state taxing jurisdictions remain open from fiscal year 2013 through 2022, with several state audits currently in progress. The Company’s major international taxing jurisdictions remain open from 2012 through 2022.

The Company's U.S. federal income tax returns for 2012 through 2014 had been subject to proceedings in U.S. Tax Court involving a dispute with the IRS regarding whether certain costs related to ANDAs were eligible to be expensed and deducted immediately or required to be amortized over longer periods. A trial was held in U.S. Tax Court in December 2018 and on April 27, 2021, the Court affirmed Mylan’s position and held that patent litigation expenses related to ANDAs are immediately deductible. The IRS’ appeal was denied by the U.S. Court of Appeals for the Third Circuit and this matter is now closed.

The impact of an uncertain tax position that is more likely than not of being sustained upon audit by the relevant taxing authority must be recognized at the largest amount that is more likely than not to be sustained. No portion of an uncertain tax position will be recognized if the position has less than a 50% likelihood of being sustained.

As of December 31, 2023 and 2022, the Company’s consolidated balance sheets reflect net liabilities for unrecognized tax benefits of $272.8 million and $296.7 million, respectively, of which $191.4 million as of December 31, 2023 would affect the Company’s effective tax rate if recognized, with the remainder being offset by potential correlative adjustments. Related accrued interest and penalties included in the consolidated balance sheets were $115.7 million and $106.4 million as of December 31, 2023 and 2022, respectively. For the years ended December 31, 2023, 2022 and 2021, the Company recognized $15.4 million, $21.1 million, and $18.5 million of tax expense, respectively, related to interest and penalties on uncertain tax positions. Interest and penalties related to income taxes are included in the tax provision.


	Year Ended December 31,
(In millions)	2023		2022		2021
Unrecognized tax benefit — beginning of year	$	296.7	$	322.9	$	391.1
Additions for current year tax positions	—		8.2		—
Additions for prior year tax positions	3.0		1.0		—
Reductions for prior year tax positions	(4.6)		(5.8)		(9.1)
Settlements	(2.1)		(0.4)		(47.3)
Reductions due to expirations of statute of limitations	(13.0)		(1.9)		(7.0)
Reduction due to acquisition	—		(27.3)		(4.8)
Impact of foreign currency translation	(7.2)		—		—
Unrecognized tax benefit — end of year	$	272.8	$	296.7	$	322.9